Merkel: Greek euro exit would be "catastrophic"

LONDON (Reuters) - Greece's exit from the euro would be a "catastrophic" political and economic mistake that would severely weaken Europe's single currency bloc, German Chancellor Angela Merkel said in a BBC interview broadcast on Monday. While Greece faces a "long and arduous road", Merkel said European leaders must keep Athens within the euro zone or risk a domino effect that would lead to speculation about more countries abandoning the currency. "This is not only a monetary decision it is a political one. ...

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LONDON (Reuters) - Greece's exit from the euro would be a "catastrophic" political and economic mistake that would severely weaken Europe's single currency bloc, German Chancellor Angela Merkel said in a BBC interview broadcast on Monday.

The mainstream media narrative - that Germany is ready and prepared for Grexit and that it is no longer a threat to financial stability - is all hype, according to German opposition finance minister Joachim Poss. As Bloomberg reports, all that is mostly posturing for an electorate tired of the aid and angst Greece has demanded since 2010.

Reuters reports Greek PM, Finance Minister Will Miss Summit Due to Illness.
Illness means both Greece's new prime minister and finance minister will miss an anxiously awaited summit of European leaders later this week and delayed a visit by the country's international lenders.

BERLIN (Reuters) - Back in May, as the euro zone veered deeper into crisis, Nobel Prize-winning economist Paul Krugman penned one of his gloomiest columns about the single currency, a piece in the New York Times entitled "Apocalypse Fairly Soon".

With Greece’s coffers emptying and payments looming, Prime Minister Alexis Tsipras’s government is in a tight race to avoid a financial day of reckoning after receiving a “final political push” from his EU partners.
While Tsipras may have bought some time after Thursday’s European Union summit in Brussels, he acknowledges Greece is facing “liquidity pressure”, without revealing how much money is left in the bank. The country’s cash shortfall is projected to hit 3.5 billion euros (US$3.7 billion) in March, according to Bloomberg calculations based on 2015 budget figures.

Berlin cabdriver Jens Mueller says he’s had it with the Greek government and he doesn’t want Germany to send any more of his tax money to be squandered in Athens.
“They’ve got a lot of hubris and arrogance, being in the situation they’re in and making all these demands,” said Mueller, 49, waiting for fares near the Brandenburg Gate. “Maybe it’s better for Greece to just leave the euro.”

With Greeks going to the polls to elect a new government in just over two weeks, concerns over a potential Greek exit or ‘Grexit’ from the euro is growing and this has led to the euro falling against the dollar and particularly gold. Speculation as to the consequences of a Syriza victory has caused the euro to fall to it’s lowest level against the dollar since 2010. Gold has surged to close to EUR 1,020 per ounce this morning – building upon the 11% gains seen in 2014.

An internal Bundesbank document discovered by Der Spiegel states, in opposition to the comments by Germany's electioneering Chancellor Merkel, that Europe "will certainly agree to a new aid program for Greece" by early 2014 at the latest. As Reuters reports, Frau Merkel has repeatedly played down suggestions Greece will require more aid (or debt relief) in light of German voters major skepticism over moar of their money being flushed into the Mediterranean.

BERLIN (Reuters) - German Chancellor Angela Merkel said on Monday she agreed with her finance minister, Wolfgang Schaeuble, that there would not be any "uncontrollable developments" in the euro zone, like a Greek default or exit from the single currency bloc. "I have heard such concerns in Asia, in China, that there could be some sort of uncontrollable process in the euro zone, but I agree totally with the finance minister that there will not be any such uncontrollable developments," she said. ...